Keynesianism and World Inflation

0:00One of Keynes' closest followers, Seymour Harris, once stated that the gold standard was Keynes' vet-noir, his black beast. Another economist, an anti-Keynesian and a pro-gold standard economist, coined a term for Keynes. He called him a chrysophobe, a gold hater. When I started to write this paper, I approached this in a little bit different way. What I was going to do is describe Keynes' numerous plans for monetary reform, really for getting rid of gold. He had many different ways of trying to get rid of it. And then criticize him. But instead of doing that, what I want to do is to focus on Keynes' chrysophobia. Go behind it and show you the underlying reasons for it. These reasons really lie in the fact that Keynes was what is called a millennialist.

0:48Someone who believed that we were on the dawn of a new age, a new age of non-scarcity, and that he was going to be the profit that would lead us into this promised land of superabundance. So, the purpose of my talk is really threefold. First, to put Keynes' chrysophobe in perspective. Secondly, to challenge the commonly accepted view that Keynes' professional life can be divided into three periods. In the first period, from around 1913 to 1923, he was supposedly a liberal internationalist who was pro-gold, pro-free trade, and believed in international movements of capital. From 1923 to about 1943 or so, Keynes supposedly became increasingly more nationalistic in his economic policies.

1:41And then finally, supposedly, for various reasons, no one knows the exact reason, he allegedly recanted his anti-free trade heresy in 1943 and became a monetary internationalist with his famous or infamous plan for a world central bank and a world currency called Bancorp. Well, this whole division, this whole way of approaching it really focuses on the wrong thing. Keynes would use any method, whether it be nationalistic or international, to try to rid the world, well first England and then the world, if he could, of the gold standard. Standard. So what I'll argue is really, he was not a liberal internationalist ever, he was always a millennialist to some extent, okay, and let me, since this is sort of a strong charge, initially I'm going to give you some quotes from two very important articles, which economists don't tend to read, they tend to gloss over. One was written in 1930 and it's called the economic possibilities The Second was written in 1933, and it was called National Self-Sufficiency.

2:53So I'm going to be drawing these quotes from these two articles.

3:02Cain's millennialism and his chrysophobia, his anti-gold mentality, is really explained at a very deep level by his peculiar view of the economic problem. He believed that the economic problem of scarcity, that is the fact that there's not enough resources for us human beings to have all that we want, is really not the permanent problem of the human race. In fact, he strongly believed that that problem of scarcity, of people not having enough, was going to be solved within two to three generations, within a hundred years. Let me give you one of his quotes on this. He proceeds as follows. I draw the conclusion that assuming no important wars and no important increase in population, and I might add here, he was in favor of population control, both in the form of quantity control and quality controls of the population.

3:54He never really went into that, and he detailed them. And no important increase in population, the economic problem may be solved or be at least within the sight of solution within a hundred years. This means that the economic problem is not, if we look into the future, the permanent problem of the human race. Okay, what was the permanent problem of the human race according to Keynes? Well, according to Keynes, the permanent problem was how to use the freedom from scarcity, which would arrive in two to three generations, the freedom from pressing economic cares, how to occupy the leisure, which science and compound interest, which is due to continuing capital accumulation, which Keynes believed in, have one for man, to live wisely and agreeably and well. Interestingly, Keynes believed that one segment of the population was right on the verge of entering the millennium.

4:46Upper class British housewives were already facing this permanent problem. That is, what to do with all their time and all their resources. And Keynes claimed that they failed to face the problem correctly and he explained nervous breakdowns among British upper class women as the failure to solve this problem. Now, okay. Right, so it's not having enough to eat, but it's not knowing what to do with one's time and having nervous breakdowns. It's going to be a permanent problem. Now, Keynes, in some sense, this is Keynes' most praxeological article, this article on the possibilities for our grandchildren, in the sense that he understands that scarcity leads to a number of things, including human purpose, and that when people act purposefully, they look to the future.

5:43That is, they exhibit time preference, and that as a result of time preference is an interest rate. And as a result of an interest rate and future wants pressing on our resources, we resort to financial accounting and opportunity costs to make sure that we're not using our resources in a way that will give us something less valuable now and giving us something more valuable in the future. Well, Keynes hated all of these things, including, and most deeply, human purpose. Let me, this is really incredible. First of all, he says that the strenuous purposeful money makers may carry us, may carry all of us along with them into the lap of economic abundance, into the millennium.

6:29But once we got there, he went on to say, yeah, there are changes in other spheres. Okay, prior to the hatred of human purpose, he understood that the market economy itself was a response to scarcity. And since scarcity was about to die out, he believed that the morals of the market and the various rules of conduct of the market were about to disappear, and he looked forward to it gleefully. Here he says, there are changes in other spheres, too, which you must come to expect. When the accumulation of wealth is no longer of high social importance, there will be great changes in the code of morals. We shall be able to rid ourselves of many of the pseudo-moral principles which have hag-ridden us for 200 years, by which we have exalted some of the most distasteful of human qualities into the position of the highest virtues.

7:18We shall be able to afford to dare to assess the money motive at its true value. The love of money as a possession will be recognized for what it is, a somewhat disgusting morbidity, one of those semi-criminal, semi-pathological propensities, which one hands over with a shudder to the specialists in mental disease. So all of these morals and so on would merely be aspects of a mental disease once we reach the millennium. And he looked forward to them disappearing. Now we get to purpose and the other things that he hated. Of course, there will still be many people, this is once we were in the millennium and we're trying to decide all our time and resources. Of course, there will still be many people with intense, unsatisfied proposiveness who will blindly pursue wealth unless they can find some plausible substitute.

8:06But the rest of us will no longer be under any obligation to applaud and encourage them. For we shall inquire more curiously than is safe today into the true character of this proposiveness, in parentheses and quotation marks, with which in varying degrees nature has endowed almost all of us. For proposiveness means that we are more concerned with the remote future results The propulsive man is always trying to secure a spurious and delusive immortality for his acts by pushing his interest in them forward into time. In other words, the attacking purpose and time preference. And, of course, we know interest arises from time preference. He goes on and he says, I see us free, therefore, to return to some of the most sure and certain principles of religion and traditional virtue, that avarice is of vice, that the exaction of usury is a misdemeanor, and the love for money is attestable, that those walk most truly in the paths of virtue and sane wisdom, I mean, this is the Messiah talking here,

9:10who take least thought for the morrow. We shall once more value ends above means and prefer the goods of the useful. We shall honor those who can teach us how to pluck the hour and the day virtuously and well. The delightful people who are capable of taking direct enjoyment in things. The lilies of the field who toil not, neither do they spin. In other words, he was completely against purposeful human behavior, which is underlayed by plans and so on. Well, to hasten the onset of this millennium, Keynes wished to push the interest rate down towards zero. to hasten capital accumulation and investment. And he's very forthright about this. He goes on in the article on national self-sufficiency, as I mentioned.

9:57But I have become convinced that the retention of the structure of private enterprise is incompatible with that degree of material well-being to which our technical advancement entitles us, unless the rate of interest falls to a much lower figure than is likely to come about by natural forces. Indeed, the transformation of society, which I preferably envisage, may require a reduction in the rate of interest towards the vanishing point within the next 30 years. But under a system by which the rate of interest finds a uniform level after allowing for risk throughout the world under the operation of normal financial forces, this is most unlikely to occur. He then goes on to say that he does support national self-sufficiency if it could break up the world capital markets and allow England alone to push the rate of interest down towards zero and allow her first to enter the millennium.

10:47So, in the 1930s, he was nationalistic in this sense. But later on, when he saw an opening for pushing the world rate of interest down towards zero, after World War II, he became an internationalist. Finally, Keynes hated economic calculation. As Ludwig von Mises pointed out, the intellectual foundation of society, society which is based on scarcity, is economic calculation, which is encompassed in financial accountancy. Well, because Keynes detested this light of the society of scarcity and because it informed people, that is financial accounting, informed people of the opportunity costs of their present enjoyment and also of the course of plans that Keynes wanted the government to undertake by borrowing from the private sector.

11:39He attacked, viciously attacked, accounting. So, in this sense, he is a very insightful praxeologist. He realizes that really the basis of society is economic calculation. He says, the 19th century carried two extravagant lengths, The Criterion of What One Can Call, for short, the Financial Results as a test of the advisability of any course of action sponsored by private or by collective action. The whole conduct of life under the 19th century liberal capitalist regime was made into a sort of parody of an accountant's nightmare. Instead of using their vastly increased material and technical resources to build a wonder city, the men of the 19th century built slums.

12:25He continues. For the minds of this generation, now he's talking about his own generation, are still be clouded by bogus calculations, that they distrust conclusions which should be obvious, out of a reliance on a system of financial accounting, which casts doubt on whether such an operation will pay, building a wonder city, for example. We have to remain poor because it does not pay for us to be rich. We have to live in hovels, not because we cannot build palaces, but because we cannot afford them. The same rule of self-destructive financial calculation governs every walk of life. He then concludes, But once we allow ourselves to be disobedient to the test of an accountant's profit, we have begun to change our civilization. And this he wanted, he applauded, and he looked forward to.

13:11Okay, as a result of this view, Keynes advocated that the state become the agent of transformation of society, because it's only the state that, number one, could manipulate the interest rate and, number two, could ignore the profit and loss test of financial accounting. Unfortunately, there was a barrier to these desiderata, to these desired results, and that was the gold standard. First of all, the gold standard prevented tinkering with the interest rate, particularly because under the gold standard, If the government attempted to push down the interest rate by inflating the money supply, gold would flow out. We'd have international capital flows, which Keynes came to hate for that reason.

13:58And secondly, the gold standard also prevented tremendous state borrowing, expansive state borrowing for a project such as building his Wonder City. So Keynes' hatred of gold, his chrysophobia, is ultimately to be attributed to his desire for this quick solution to the economic problem. Interestingly, after I'd written this, I found that Wilhelm Repke, as I mentioned, a pro-gold standard anti-Keynesian economist, saw the connection between Keynes's Chrysophobia and his millenarianism, or millennialism. A short quote from him I want to read. Repke says, it can be traced from, that is, Chrysophobia, can be traced from John Law, where all arguments can already be found to Keynes.

14:44Chrysophobia does, in effect, have a penetrating odor of ideology and of a sort of world-do-goodery. It is a form of indignation about something allegedly antiquated, primitive, anti-progressive, reactionary, profit-minded. Chrysophobia is a form of social rationalism extolling something as progressive, enlightened and superior. It's a sort of doctrinairism in the sense of an attitude riding Rothschild over the facts. And, of course, the fact was the enduring scarcity that pervades human life.

15:21Okay, as any great messiah or would-be messiah, Keynes was a great myth-maker, and he wove an enormous number of myths designed to discredit the gold standard from the beginning of his professional life. In fact, not only did he attempt to discredit the gold standard, on one occasion he even defamed it. He turned into a person. He referred to it as Ori Sacra Famis in Latin, which as a plan of words could mean the sacred reputation of gold or the accursed reputation of gold. He went on and wrote a satirical attack on it. So Keynes then opposed gold, socially determined interest rates and investment allocations throughout the world during all the periods of his professional life. What are some of the myths that he perpetrated? And that are still existing today.

16:10First of all, in 1913, in his supposedly only pro-gold book, Indian Currency and Finance, he told us that the gold coin standard only works for Great Britain because it is the world's banker. It didn't really work for other nations. He advocated the other nations to develop a gold exchange standard. and the gold exchange standard. He went on and said that he revived a myth that David Ricardo had brought into economics by telling us that the circulation of gold among the public was really, and also the holding of large gold reserves by central banks, was an insupportable and intolerable expense. He wanted to get rid of them. Now Keynes, in this book, looked forward to the ideal currency system of the future as has a gold exchange standard and he even hinted that out of the gold exchange standard we get a paper money standard for the whole world.

17:07But it's interesting that he thought that the gold exchange standard was such an ideal system because twice in the history of the world it broke down with terrible results. Once in 1931 or so and again in 1971 under the guise of the Bretton Woods system. In 1923, he wrote a book which one economist, Michael Halpern, calls a time bomb underneath the gold standard. This book was called The Track on Monetary Reform. And here, Keynes, for the first time, made the claim, which eventually was accepted by almost all economists, though there's some reaction to it today, that there's a dilemma between internal and external stability. That is, if you're on a gold standard, your exchange rates are stable but at the cost of severe instability of your domestic price system.

17:57He also claimed that stable exchange rates and the gold standard are not a way of integrating the whole world economy, but he claimed it's merely convenience which adds to the efficiency and prosperity of foreign traders. He also told us that he acknowledged that there was tremendous long-run stability under the gold standard in the 19th century, that is, price stability. But he claimed that that was merely a half accidental circumstance. He also went on to say that it was partially a result of the fact that central banks inflated the money supply to offset falling prices or a price level that would have fallen because of a tremendous number of goods being produced or the increase in the growth of goods.

18:44In 1930, he was back on the attack again. Here, he began to focus on foreign investment as a villain under the gold standard. First of all, he claimed that, well, in the long run, we don't like foreign investment, we being the British rulers, because it used up British savings to increase capital goods, not to raise the productivity of British workers and get them to the millennium faster, but to raise productivity of workers throughout the world. Secondly, he believed that in the short run, we had a transfer problem. Basically, if we tried to transfer capital, Britain lent to the United States or lent to an underdeveloped country and tried to transfer capital, the capital via the gold standard, The central bank would have to raise interest rates and that would cause higher employment, falling prices and lower current income for the British working class.

19:44And finally, he made two statements that he really didn't try to back up. He said that gold has been in chronically short supply for all of history. And in some ways he implied that silver was to be much preferred, but that somehow gold, and this is the second part of this assertion, Gold due to irrational and deeply held psychological predilections, he called it a furtive Freudian cloak, overcame silver. Okay, so he didn't try to explain the emergence of the gold standard by looking at the market processes involved. He just basically asserted that it was due to psychological reasons. Okay, so what, oh finally, in one of the last articles he wrote, or rather an article in the 1940s, about 1943, Keynes made a further attack on the gold standard, and this wasn't based on a myth.

20:41By that time, Keynes openly was saying that wage rates, what he called efficiency wages, which are labor costs, were going to continue to rise, okay, year in and year out, and that what was wrong with the gold standard was that the gold standard would not permit these This rise of labor costs without bringing on severe depression. So he was openly advocating inflation at this point in 1943. That is, he said labor costs tended to rise more quickly in Great Britain than they did elsewhere in the world. If Great Britain tried to stop this with the gold standard mechanism, it would cause an outflow of gold, a tightening of the money supply and tremendous unemployment. So, what he basically went on to say was that this was going to continue into the future, the rise of labor costs, and he wanted to get rid of the gold standard because it prevented this.

21:36Okay, as I mentioned, let me just mention some of the plans, the many plans that Keynes came up with for international monetary reform. As early as 1913, as I mentioned in the book on Indian currency, Keynes advocated discouraging the deliberate discouraging of the public holding gold and centralizing all the gold reserves, even in England. He wanted to substitute the gold exchange standard for a full gold standard and he also wanted the government to manipulate the gold points by only allowing limited convertibility of currency into gold. So, already in 1913, he's tinkering with the gold mechanism and pushing down interest rates.

22:21And it was in this book, as I mentioned, that he pointed out that the gold exchange standard would eventually give rise to the ideal currency standard of the future. In 1923 in his book The Track, he called for the central bank, the Bank of England, to abandon its pledge to redeem its liabilities in gold and to seek instead to stabilize prices by manipulating the interest rates, short-run interest rates. But he didn't want the exchange rate to fluctuate too freely, he wanted the government to regulate that by changing the buying and selling price of gold every Thursday. which is something that later on President Roosevelt resorted to. He also wanted to widen the gold points once again.

23:08And he also had a strange scheme to manipulate the gold price in forward markets so as to artificially raise British short-term interest rates to prevent the outflow of capital. In 1930, in his treatise, Keynes came out for a comprehensive monetary reform, which included making domestic currencies, or at least currencies held by residents, inconvertible into gold, taking all gold out of circulation, putting all the gold into the central bank and reducing bank reserves, And then setting up what he called a super-national bank, a central bank's bank, issuing SBMs, super-national bank money.

23:55So in 1930, allegedly when he was in the period of his economic nationalism, he was calling for central bank cooperation. He was calling for worldwide inflation via a paper, a worldwide paper fiat currency. So he wasn't international because he thought in 1930, with the Depression, governments of the world may now listen to a call for world inflation. So he abandoned the call for flexible exchange rates. In addition, Keynes called for taxing and controlling long-term foreign investment. He also wanted short-term lending and capital exports manipulated by, again, changing the price at which the, or rather, the gold points.

24:44By 1943, Hayes came out with a plan known as the International Credit Union in which he called for a central, worldwide central bank, which wouldn't create fiat money, but would create bank deposits that only central banks could hold. This is known as the Keynes Plan of Monetary Reform and as we'll see in a moment or two, a lot of elements of this plan are combined in the various plans by current-day Keynesians to reform the International Monetary System. This plan was very, very, very inflationary. It proposed to tax those countries, which are called the creditor countries, which had sound monetary policies, such as the United States after World War II, or at least relative to the European countries.

25:35He wanted to put a 1% tax on them if their balances, their bank balances in this international bank were building up. Where on the other hand, there wasn't much control at all on the deficit countries who were doing the inflating. Much of this plan, but not all of it, was encompassed in the International Monetary Fund, established at Bretton Woods. The plan is heavily Keynesian. What is interesting was that a number of economists who formerly favored the gold standard, and even at the time did, fell prey to Keynes' false monetary internationalism. For example, Michael Halperin, who was a pro-gold standard economist, agreed with Keynes that we couldn't go back to the gold standard after the World War II, because we would first have to develop internationalism.

26:33That is, we had to develop international cooperation among central banks. So he wanted to postpone going back to gold. Another economist, Edwin Kemmerer, who believed in the gold coin standard, said, well, before we could have the gold coin standard, we have to set up a world central bank. Bank. The only economist who courageously fought this was B.M. Anderson, who was a Wall Street economist for a long period of time, or bank economist, and he came up with a great statement in support of the gold standard and against this phony internationalism of Keynes. He said the following, he said, I want to see a real gold standard world again, with several powerful money centers competing for gold and holding one another in check.

27:26In other words, he didn't care, he wanted to see these flows of capital out of the countries with the inflationary monetary policies. I don't want international monetary cooperation in ordinary times. It prolongs unsound tendencies, as in 1924-29, and then it breaks down in crises as in 1931. I want competition in ordinary times and cooperation only in crises, and that at a stiff rate of interest. That is, if one central bank was to help another, they would charge him a penalty rate. I have been too close to the centers of wisdom and power in governments and central banks I don't have any belief at all in the adequacy of their wisdom to do more than routine things. The more I see of governmental economic policy, the more I trust the automatic forces of free markets. The more I see of public monetary policy, the more I trust gold.

28:14So he was one of the few that didn't succumb to Keynes' arguments on this. Finally, let me say a few words about current plans for monetary reform, which have been brought up or presented by Keynesian economists. Basically, Keynesian policies on the national level have been discredited since the early 1970s, including fiscal fine-tuning. However, because of the unpredictable and unpredicted volatility of floating exchange rates that we've had since 1973, many government economic policymakers have become dissatisfied with floating exchange rates. One of the reasons is that floating exchange rates pretty quickly shows up the effects of inflationary monetary policies and huge budget deficits.

29:02Now, as Murray Rothbard has pointed out, Keynesian economics has evolved into a pure economics of power, promising the powers that be really a quick fix or a papering over of the effects and consequences of inflation. And that's what these new plans all pretty much do. What they seek to do is to allow governments to reintroduce fiscal fine-tuning by the back door and allow them to also inflate while ensuring a seeming stability of exchange rates, at least temporarily. Let me just allude to a number of these plans. First of all, we have the crawling target zones, which is a variation on the old crawling peg. Two economists, both of whom were former bureaucrats, The bureaucrats, John Williamson was a former advisor to the IMF and to the British Treasury and C. Fred Bergsten, who was a former assistant secretary of the Treasury and member of the senior staff of the National Security Council, advocate this crawling target zones.

30:04Basically, what they want to do is to formalize the Louvre Accord of 1987 among the seven industrial democracies, including the US, and make the so-called secret reference ranges of exchange rates. Exchange Rates, they want to make them formal and binding. They claim that there's misalignments of exchange rates, that is, when exchange rates float, you have real problems in your export sector and your import sector. The reason being, and Mises pointed this out a long time ago, that exchange rates adjust much more quickly to expected changes in monetary policy, expected inflation, than do internal prices. So before, in the interim, before internal prices adjust, you have tremendous, tremendously devastating, in many cases, real effects.

30:54For example, the appreciation of the U.S. dollar from 1982 until 1985 or so, that caused the shrinkage of our export sector. Okay, so they want to get rid of these misalignments, but they don't want to do it by engaging in non-inflationary monetary policy. What they want to do is to find some exchange rate, plus or minus 10%, that they call the fundamental equilibrium exchange rate. Now what they want to do is the government to fix the real exchange rate and allow the nominal rate to change according to differential inflation. So the sole virtue of fixed exchange rate without gold is that it may very well restrain the inflationary propensities of governments, of Governments. But this doesn't even do that, because it allows the nominal exchange rate just to float.

31:47That is, if the U.S. inflates more than Great Britain, for example, the exchange rate depreciates. As long as the exchange rate doesn't depreciate faster than the rise in prices, they'll allow it to move. They want to use, they want the government to use manipulation of interest rates to keep the exchange rate within this target zone. But on the other hand, they want to allow the governments, the group of seven governments, to use fiscal fine-tuning to expand continuously year after year what they call domestic demand. In other words, they want to bring back the discredited fiscal fine-tuning. By immobilizing monetary policy, by aiming it towards exchange rates, the government is left with only one instrument with which to increase demand in the domestic economy.

32:41So we're back with fiscal fine-tuning. And finally, if people, they want each government, each of the seven governments to set some sort of target level of increase in their spending, of domestic spending. If total spending of these seven countries falls short of this target level, they then want all seven governments to agree to push down interest rates in unison. The second proposal is the gold standard without gold, put forward by Ronald McKinnon, a professor at Stanford University. He wants to stamp out the social inefficiency of floating exchange rates, okay, due to the fact that private foreign exchange traders do not have sufficient information regarding future monetary policy.

33:32Well, if monetary policy was non-inflationary, okay, they would have that information. So, in some sense, it's sort of placing the blame on the private sector. However, government planners using computed price indexes, past price indexes, and also using a very simplistic version of the purchasing power of parity theory of exchange rates, which in its more expanded form is correct. They believe government planners can come up with the right exchange rate. and some of the details of the plan include fixing that they would fix they would actually fix exchange rates nominal exchange rates among three currencies the yen the dollar and the more McKinnon encourages daily manipulation of the exchange rate to ensure that you have no destabilizing flows of short-term capital he also wants the government to intervene if that doesn't work to intervene directly in the foreign exchange market.

34:32Finally, he wants joint monetary policy. That is, he wants the three central banks to get together and expand their money supply in unison with the aim of keeping a wholesale price level stable. Thus, national central banks would give up their right to inflate at different rates, but not to inflate. Why not gold? Why does he want a gold standard without gold? Basically, he claims that the gold standard is an unstable base for the money supplies of the different nations and he, like Keynes, dismisses the 19th century experience with stable prices and integrated world price structure that came about under the gold standard. Again, he claims that, well, it was really paper money inflation that provided this stability, not the gold standard itself, that is, the central banks using discretion manipulated the money supply so as to offset any 10% Natural Tendency of Prices to Fall under Gold.

35:31Finally, the final plan is one for a global bank of issue. This is put forward by Richard Cooper, a member of the Council of Foreign Relations and a member of, I believe it was Kennedy's Council of Economic Advisers. Again, the goal is to reduce arbitrary movements in real exchange rates and to fix exchange rates by imposing a single currency. So this is more ambitious than the previous two plans. He would actually have some currency, it could be the dollar or derivative of the dollar, but it would be a single currency. And the global bank would engage in open market operations, buying the securities of the various member governments.

36:19So governments would give up their control over monetary policy, over the rates at which they were inflating their money supply. However, they would be able to use fiscal policy, that is budget deficits, to get their economies moving. But they could only monetize these debts to the extent that the new money was being used, the increment in the new amount of world money was being used to purchase their own securities. And finally, a fourth Keynesian, James Tobin, who agrees with these plans, but says that they're really not viable in the foreseeable future. He instead regretfully recommends, and I'm quoting, throwing some sand in the wheels of our excessively efficient international money markets.

37:07What he wants to do is to put a 1% tax, internationally uniform, all countries, each country would be in charge of enforcing a tax within its own borders, on all spot conversions of one currency into another. This would fall most heavily on short-term capital movements. For example, he estimates that a 1% tax would require for it to be profitable to invest in a foreign treasury bill. There would have to be an eight percentage point differential in the annual rate of interest. So what he's done is to segment the world capital markets, which was Keynes's point, to prevent capital outflows as a reaction to inflationary government monetary policy.

37:55Okay, to sum up, while these plans do not partake of Keynes's millennialism, Okay, they do go back to the monetary plans that he devised in support of this. In fact, in today's world, the goal of economic growth really does hark back to this whole idea of moving us into the millennium. That is, that that's one of the legitimate goals of government economic policy, to spur economic growth. I mean, it's a pale reflection of Keynes's millennialism, but it's there. Oh, I'll stop here.